What is included in the "Amount financed" according to the TILA?

The "Amount financed" under the Truth in Lending Act (TILA) refers specifically to the total amount of credit extended to the borrower. This amount encompasses the loan amount minus any upfront fees or finance charges that may have been deducted, which means it represents the actual money that the borrower will receive and can use. It is crucial for consumers to understand this figure, as it is the basis for evaluating the cost of credit and the terms of the loan.

This definition allows borrowers to assess the full scope of their financial obligation without being misled by how the fees or other charges might obscure the true amount of loan funds available to them. Understanding this concept is vital for accurate financial planning and decision-making when taking out a loan.